How to know your Business Activities: A question to be determined…


As we all know, the United Arab Emirates provides ease of doing business, as we have already discussed in our previous article on mainland company formation in Dubai. The Investor, or Entrepreneur, needs to choose the business activity before forming the company. The same depends upon the nature or type of business a Business Investor wants to conduct. Therefore, it is imperative to choose the type or kind of Business Activity before forming a company.

In this article, the expertise of our Company Formation Lawyer and Business Lawyer Dubai, we will be dealing with topics relating to business activities, types of trade licenses, business activities that require pre-approvals, and at last high-risk and low-risk possibilities of business bank account opening is explained in a detailed manner. Therefore, this article is being drafted in a question-and-answer form for the better understanding of the reader and will be covering the following topics mentioned below:


Now, let’s move to the questions for understanding the core elements before conducting any business in the United Arab Emirates.

What are Business Activities? 

Our Business Lawyer Dubai states that: 

Business activity is a term in which an Investor or Businessman wants to operate by obtaining a trade license, professional License, or industrial License. These Trade licenses are issued by the regulated body or authority based in the specified zone; on this License, specific activities are mentioned that businessmen or investors want to conduct. Moreover, these Trade License plays a pivotal role in opening corporate bank accounts or entering into contracts with third parties or businesses. It is pertinent to mention here that Trade License can only be used for Business activities mentioned upon it and known as Licensed Activities. In case you conduct activities not mentioned upon the Trade License, then you are subject to bear a hefty fine. The Bank may suspend your Business Bank Account upon suspicion of conducting activity other than mentioned on the License.

The sample of Mainland Trade License bearing Project Management Services as Business Activity is mentioned herein below for the understanding purpose only:

If someone wants to know about the description of the activity, then the same can be searched from the concern website of the authority in this case we have extracted details from the DED website, for educational purpose only:

The above-mentioned image clearly depicts the full description of the activity with the code mentioned therein and the group and type where such activity falls. Moreover, we have highlighted the content where it is specifically mentioned that this type of activity is not allowed to practice the activity relating to Project Management Engineering & Technical Feasib, which means a specific business is allowed to conduct specific activity and not otherwise.

Samples of the Trade License of Mainland and Freezone Company

The below mentioned is an example of Trade License with description issued by Mainland Authority.


The below is an example of Trade License and business activity description issued by Freezone Authority.


The below is an example of Trade License and business activity description issued by Freezone Authority.


How many Business activities are allowed to conduct in one Trade License?

Our Business Formation lawyer states that:


General rule is that you can have unlimited business activities in on Trade License. However, you need to know that there may be limitation on the business activity depending on its nature. Supposing you are holding a Trade License with the group activity which falls under Professional type then you are only allowed to opt out for more activities which falls under the professional group and not which falls within the Commercial Group. In order to add more activities then the Investor has to pay separate fees for each activity.


Generally, in freezone you can have all the activities in one trade license whether it pertains to Commercial or professional activities, there is no limitation on the activities. Moreover, Freezone provides more activities in one license suppose 3 or 5 business activities with one trade license and if you want to add more than fees per activity is to be submitted with the Freezone Authority.

Which Business activity to be included in Trade License as a start?

Our Business Lawyer Dubai advice:

The answer to this question lies within your business strategy. We advise you to not to opt for more activities at the beginning as  it will cost you more and you should start with the mainly one or two business activities which you need to focus or conduct first. You also have an option at the later stage to add more activities with the growth of your business.

Whether the business activity opted by you is regulated or not?

Our Business Formation lawyer states that:

Some business activities are being regulated by law or relevant authorities. The example of such activities which are being regulated is mentioned below:

Name of Activities Regulated or not Ministry
 Law Firm  Yes Ministry of Justice or any other related authority existing in an emirate.
Legal Translation Yes Regulated by Ministry of Justice but limited to Legal purpose only.
Food Production and Industries  Yes Regulated by Food Departments and Municipalities.

The abovementioned activities are examples of numerous other exercises regulated by the authorities.

Regulated Business: These are those businesses that must follow the regulations of the authorities under which they fall. If you perform your business against the rules the concerned officer or ministry issued, then your business is subject to a financial penalty.

Whether your business requires pre-approval? 

Our Business Lawyer Dubai states that: 

Pre-approval is the permission that is required to be obtained from the concerned authority before obtaining Trade License. Most of the activities either in Mainland or Freezones require pre-approval of the rules under which such activities fall into.

Example: Engineering activities require pre-approval from municipalities before starting a company or business, as the authority must check whether such a company is competent enough to conduct business in engineering-related activities and possesses a qualified team of accredited engineers.

On the other hand, sports activities require licensed trainers to obtain approvals for exercising business.

Similarly, some activities require accredited members from UAE-certified bodies before starting a business, including but not limited to Lawyers, Legal Consultants, Legal Translators, Engineers, Doctors, Nurses, and or Gym Instructors.

What are high, medium, and low-risk business activities? 

The type of risk depends upon the nature of your business activity. The scale of activities varies from High to Low and is associated with the opening of a bank account and depends on how the Bank sees your business activity from the point of being risky for money laundering or a high volume of cash transactions.

Example: High-Risk Activities are concerning gold trading, financial activities, and other activities depending on bank criteria

The risk scale defined how complicated it is to open a bank account, as the requirements of the banks for such high-risk activities are more than for low-risk activities that require more verifications and additional KYC inquiries. You can know the scale of activities risk by inquiring about the banks with which you expect to open your company account.

Whether your business activities require reporting to any Government Authorities? 

The first type of reporting is ESR (Economic Substance Regulations) reporting. The companies that do certain activities must meet specific criteria to ensure that these companies are doing business in the UAE.

The second type of reporting is AML Reporting, related to Anti-Money Laundry regulations. Most professional activities are subject to these regulations, such as law, consultancy, brokerage, accounting, auditing, etc.

How can we help you?

Nour Attorneys Law Firm tends to provide you with one of the best company formation services and bank account services, as our business formation lawyers are highly experienced and skilled. Our Business lawyers in Dubai are capable enough to provide you with the best solution for your business as they act, we act as your business partner in commercial and legal affairs.

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